Michael Winship: More of the same with Obama?

Monday

Veteran Washington journalist Wllliam Greider fears that what the Obama administration is proposing may not create reform, but simply perpetuate more of the same.

A college friend of mine, after much quaffing from the keg, so to speak, would start singing a faux hymn that began, “We are sliding into sin — whee!”

I’ve thought of his bleary tune from time to time as we all watched our financial institutions slide from thoughtless, wretched excess into calamity, aided and abetted by deregulation and bailouts, dragging the rest of us along on their speed bump-free ride.

You’d think there would be a modicum of contrition but mostly it has been deny, deny, deny combined with shivers of revulsion as an angry citizenry freely expresses its opinion. Former Clinton SEC chairman Arthur Levitt sniffed to The Wall Street Journal this week, “It has reached extremes of incivility that are intolerable,” and on Friday the Journal editorially wrung its hands over “political Torquemadas” who would dare to prosecute Wall Street executives.

See here, you people, the seemingly dumfounded elite ask, why all this hollering? Well, it wasn’t only those AIG bonuses that had folks mad as hell. For sure, they triggered the outburst last week. But then came an ABC News report that JPMorgan Chase — recipient of 25 billion in bailout bucks, courtesy of taxpayers — was pressing ahead with plans to spend $138 million on two new corporate jets and a place to park them: A state-of-the-art hangar with a “vegetated roof garden.” Presumably, bank executives will use the vegetation to hide behind when the mob arrives with tar and feathers.

And speaking of greenery, Wednesday’s New York Times reported that last year 25 top hedge fund managers harvested salaries totaling $11.6 billion. That’s an awful lot of lettuce in these hungry times, especially when, as the Times calculates, hedge funds have lost an average 18 percent of their value.

By Thursday, Treasury Secretary Geithner was talking tough to Congress. He called for a vast expansion of government authority, promising to crack down on Wall Street’s reckless behavior, including the murky markets of hedge funds and derivatives. He proposed “comprehensive reform — not modest repairs at the margin, but new rules of the game.”

But veteran Washington journalist Wllliam Greider, who has covered government, politics and the economy for four decades, fears that what Geithner and the Obama administration are proposing may not create reform but simply perpetuate more of the same and even lead to the creation of what he calls “a corporate state … a rather small but very powerful circle of financial institutions. ... Yes, watched closely by the Federal Reserve and others in government, but also protected by them. And that’s a really insidious departure.”

He expressed his concern to my colleague Bill Moyers in an interview for "Bill Moyers Journal" on PBS. Greider agrees with most experts that the Geithner plan will end up placing reform in the hands of the Federal Reserve Board.

Twenty years ago, Greider wrote “Secrets of the Temple: How the Federal Reserve Runs the Country,” still considered the definitive account of the government bank. “They couldn’t stop deregulation,” he said. “In fact, they supported it, because they knew their major constituencies in finance and banking were all very much for it. ... So to tell them now ‘Wouldn’t you like to just admit your mistake and put back some of the collateral lending functions into your control?’ I don’t trust them to do that.”

In his new book, “Come Home, America: The Rise and Fall (and Redeeming Promise) of Our Country,” William Greider sees the public’s anger as good news for the country — “America the Possible,” he calls it.

“We’re at a break point in our history,” he said. “And it’s not just the financial system, although that’s front and center. … It’s a lot of things coming at us, all at once. I believe … on the other side of all of these adversities, we can become a better country."

But to make that happen, Greider thinks, “People … have to find ways to come together themselves, perhaps in very small groups at first, and talk about their own stuff. Their experiences, their ideas, their convictions, their aspirations for the country, themselves, their families, and then broaden out a bit, laterally. … They don’t have to become a giant organization, but they have to convince themselves that they’re citizens …

“That’s kind of the mystery of democracy. People get power if they believe they’re entitled to power.”

Michael Winship is senior writer of the weekly public affairs program Bill Moyers Journal, which airs Friday night on PBS.

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